When Google joined the social networking space in 2011 with Google+, more than 25 million people joined in the first month. Now the number of true users on Google+ is less than 1% of the total 2.2 billion users on Google, according to a report by Stone Temple Consulting.
Some of the decline may be explained by the fact that a Google+ profile was created automatically when people registered for Google. That alone would generate an impressive number of profiles, but wouldn’t necessarily lead to active use of the social media platform. According toForbes, just 6.7 million users have 50 or more posts ever, and only 3.5 million have 50 or more posts in the last 30 days.
Valuing a company is always a mix of science and art, especially for startups. Historically the science has been pretty simple: Find comparable companies and do a multiple of earnings or revenue.
However, three drivers of startup valuation have emerged that are changing the game. “Acquihire,” is the act of buying out a company for the skills and expertise of its staff. It has become so well-known that it is even listed in the Oxford English Dictionary. When Facebook buys a company like Hot Potato, it’s not for the revenue stream or products — it’s for the employees.
A lot of attention has been paid lately to big tech companies buying up smaller firms in billion-dollar deals: In January, Google acquired Nest for $3.2 billion, Facebook purchased mobile message service, WhatsApp, the following month for $19 billion; last week, it acquired virtual reality gaming company, Oculus VR, for $2 billion. There is a lot of discussion about the motives behind these large deals. Some say they are attempts to block competition, while others maintain they are efforts to stay relevant.
I see these deals as a reflection of the uncertainty companies face as they try to identify the next big thing. This is especially true for successful companies like Facebook (FB) and Google (GOOG), which are known for doing what they do tremendously well. They’ve seen similarly successful companies like Kodak struggle as technology moves on, rendering its product obsolete. As a result, companies today are eternally motivated to look outside their current business.
CAMBRIDGE, Mass. (MarketWatch) — A year after the Facebook IPO the media bellyaching about all the things the social media company did wrong is relentless.
“Facebook, One Year Later: What Really Happened in the Biggest IPO Flop Ever,” reads a headline in The Atlantic. “Missed out on the Facebook IPO and couldn’t be happier,” reads another on CNNMoney. And from Forbes: “Facebook Year One: Fighting Back from an IPO Flop.” Read More »
George Westerman (MIT Center for Digital Business), interviewed by Michael Fitzgerald
October 29, 2012
Big traditional companies get overlooked when it comes to digital transformation. But companies across all industry sectors are remaking their operations, their customer interactions, and even their business models. George Westerman tells us how they’re doing it, whether they are technology champions or beginners.